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Managerial Accounting Budgeting

   

Added on  2020-10-22

15 Pages3717 Words483 Views
MANAGERIAL ACCOUNTING

EXECUTIVE SUMMARYBudgeting is termed as very important concept in management accounting. It helps tokeep appropriate balance in its income and expenses in efficient aspect. The present study isdiscussing about budgeting with context of management accounting. It will provide detailedinformation associated to budgeting with its type of approaches. These approaches aredescribed with its merits and demerits in management accounting. Further, there is selection oftwo scholarly articles which are based on budgeting with management accounting insponsorship decision making process. From study 1, its major finding is of significant budgetaryrole for evaluating performance and from study 2 it reflects active budgetary role asauthorisation. Further it could be summed up by stating that budgeting helps in attainingsuccess in efficient aspect.

TABLE OF CONTENTSINTRODUCTION................................................................................................................................1MAIN BODY .....................................................................................................................................1Explanation of Budgeting............................................................................................................1Explanation about question and purpose of study ....................................................................4Discussion about both study with its findings............................................................................5Specific lessons and outcome from two studies which are useful for managementaccountants.................................................................................................................................8CONCLUSION..................................................................................................................................10REFERENCES...................................................................................................................................11

INTRODUCTIONManagerial accounting is also referred as cost accounting with process of interpreting,analysing, communicating, identifying and measuring information to managers with context ofobjectives of business entity. Budgeting refers to process of framing plan for spending money asthis expenditure plan is known as budget. It helps to keep appropriate balance in its income andexpenses in efficient aspect. The present study is discussing about budgeting with context ofmanagement accounting. It will provide detailed information associated to budgeting with itstype of approaches. These approaches are described with its merits and demerits inmanagement accounting. Further, there is selection of two scholarly articles which are based onbudgeting with management accounting in sponsorship decision making process. The otherscholarly article which will be chosen will show budgetary role with context of sponsorshipmanagement as contingency perspective. It had provided explanation of purpose of both studywith its method which is used for exploring topic. In the same series, it had been discussedcontrasting aspect of both study with its outcome which are important for managementaccountants.MAIN BODYExplanation of BudgetingBudgeting refers to process for creating plan for spending money. The plan of spendingis known as budget. In simple words, the creation of this spending plan helps for allowing foridentify in advance about presence of sufficient money to perform activity according to need.Generally, it balances expenses with its income. If there is high spending as compared toincome, then it creates problem. If spending or budget plan is followed in appropriate mannerthen it will help for keeping free from debt (Cowton, 2018). The basic principles of budgetingare:Planning annual operationsSetting coordination in work of different parts of businessCommunicating plans to managersMotivating manager for attaining goalsControlling activities1

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